Trump Plans 25% Tariffs on Autos, Drugs and Semiconductor Chips

U.S. President Donald Trump said on February 18 that he plans to impose tariffs of "about 25%" on autos and similar tariffs on semiconductor and drug imports. This is his latest move to upend international trade.

Trump said the auto tariffs could be implemented as early as April 2, before his administration completes a review of a series of import tax options.

Trump has long criticized the unfair treatment of U.S. auto exports in foreign markets. For example, the European Union imposes a 10% tariff on imported vehicle, while the United States only imposes a 2.5% tariff on passenger cars. However, the United States imposes a 25% tariff on pickup trucks from countries other than Mexico and Canada, claiming that this policy helps make pickup trucks a profitable area for American automakers.

On February 18, Trump told reporters at Mar-a-Lago in Florida that tariffs on drugs and semiconductor chips will also start at "25% or higher" and rise significantly during the year.

Trump did not specify a specific date for announcing the tariffs, and said he wanted to give pharmaceutical and chipmakers some time to set up factories in the United States so they could avoid the tariffs. He also said he expected some of the world's largest companies to announce new investments in the United States in the coming weeks, but he did not provide further details.

Since taking office on January 20, Trump has imposed a 10% tariff on all products imported from China on top of existing tariffs.

Trump also announced 25% tariffs on Mexican goods and Canadian non-energy imports, while imposing a lower 10% tax on Canadian oil and gas. He postponed those tariffs until after March after the two countries announced "enhanced border security measures."

He also announced that he would impose a 25% tariff on all imported steel and aluminum from March 12, eliminating exemptions for Canada, Mexico, the European Union and other trading partners. Trump said the tariffs would apply to downstream products made of steel and aluminum, such as electrical conduit and bulldozer blades.